EU’s REX system: Exporters now enjoy hassle-free certification of goods origin

Graphics: TBS

The introduction of an online system by the European Union for Bangladeshi exporters to self-certify origin of their goods has somewhat provided them with relief from harassment they used to go through in the time-consuming manual process.

In 2019, the EU introduced the Registered Exporter System (REX) for exporters to get registered in a database by their competent authorities, the EPB in Bangladesh, and become entitled to make out a statement on origin based on a principle of self-certification.

The system is made available to GSP beneficiary countries enjoying duty-free market access in the EU. Exporters still manually collect certificates of origin of goods for duty-free exports to other countries.

Exporters need to show country of origin declaration certificates at EU ports for duty-free access of their goods to the region. Earlier, such a certificate was issued by the Export Promotion Bureau (EPB) manually.

According to sources, there are now 3,000 REX-registered exporters. 

An exporter makes self-declaration of the country of origin for their goods and submits the statement to buyers through the REX system. They also send necessary documents to the EPB for keeping records. In this case, all responsibilities regarding origin of goods lie with the exporters.

If the customs authorities of European countries want, they can verify with the EPB whether the exporters are registered with the EPB or not.

Exporters say to obtain the origin of goods certificates in the manual process, they would go through many hassles from submitting many documents to making the rounds in the EPB office.

Entrepreneurs also allege that they even had to pay bribes for that.

The EU's REX system for GSP beneficiary countries fully went online in August last year.

Expressing satisfaction over the system, exporters demand that other government agencies be brought under such an online system.

Md Shahidullah Azim, vice-president at Bangladesh Garment Manufacturers and exporters Association (BGMEA), told The Business Standard, "Since the introduction of the REX system, our costs have decreased and we do not have to face any harassment. The more online the system, the less likely it is that harassment and irregularities will occur. We want all government departments, including the customs, to conduct all activities online this way."

Seeking anonymity, a commercial officer of a top apparel exporter, said, "We ourselves now declare the origin of goods directly to EU buyers and send information to the EPB for keeping records."

Mostafa Abid Khan, an international trade specialist and former member at Bangladesh Trade and Tariff Commission, said the EU's REX system has been beneficial to all parties, which has made it easier for Bangladeshi exporters to do business as well as reduce costs. 

On the other hand, it has also made Bangladeshi exporters and their buyers responsible, he noted.

If man-to-man contact reduces, so do chances of corruption. The services of other organisations in the country should be brought under the online system, he added.

EPB Director Kumkum Sultana told TBS that after the introduction of the Rex system, they do post-verification of documents submitted by exporters. 

In addition, they also scrutinise consignment documents upon requirements from European buyers and shipments of suspicious goods or non-textile products, she added.

But, the EPB did not provide any specific information on the number of declarations of origin of goods that are exported to the EU.

Kumkum said from now on, it will be easier to get this information as there is an integration between the National Board of Revenue and the Bangladesh Bank to facilitate EPB's document verification.

Fazlee Shamim Ehshan, vice-president at the BKMEA, said over 2 lakh self-certifications of goods of origin go to the EU a year.

The certificates of origin for goods shipments to countries other than Europe will stand at 1 lakh a year, according to EPB sources.

EPB vice-chairman AHM Ahsan told TBS that with the introduction of the Rex system, exporters' representatives no longer have to come to the EPB. Everything is done online, which is a big step forward in the ease of doing business.

The EPB is currently charging Tk250 in software charge for keeping record of an origin of goods, with which exporters do not agree.

Fazlee Shamim Ehshan, vice-president of BKMEA, said there is no need to pay for this service in other countries of the world, including other Saarc ones. 

"Then, why will we pay in Bangladesh?" he said.